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Finance Faculty Research Profiles

The Department of Finance faculty are continually engaged in innovative research and are dynamic participants in the academic community. Check back for updated spotlights on our faculty to learn more about their research.

I’ve always been interested in how information impacts decisions. Information is the lifeblood of decisions so it intersects all areas of finance but my main interest is the "human" reaction to information, which most people call behavioral finance.​​​​​​

It isn’t so much integrating specific research into the classroom but trying to teach a research, or scientific, way of thinking to students.
They need to see that it is data not anecdotes that should drive decisions.​

Informed local trading prior to earnings announcements (Journal of Financial Markets)Do individual investors have better information about local stocks? Our results demonstrate that they do. Large trading imbalances by investors living close to a firm's headquarters predict the stock's earnings announcement return. Stocks with the most net buying by local investors average significantly higher market-adjusted announcement returns than stocks with the most net selling by local investors. This return difference is pronounced for small- and medium-sized firms, but absent among large firms, which have significant analyst coverage. Local investors' information advantage comes at the expense of nonlocal traders.

Public Information Arrival (Journal of Finance)We develop a measure of public information flow to financial markets and use it to document the patterns of information arrival, with an emphasis on the intraday flows. The measure is the number of news releases by Reuter's News Service per unit of time. We find that public information arrival is nonconstant, displaying seasonalities and distinct intraday patterns. Next we relate our measure of public information to aggregate measures of intraday market activity. Our results suggest a positive, moderate relationship between public information and trading volume, but an insignificant relationship with price volatility.

Bank loan supply responses to Federal Reserve emergency liquidity facilities (Journal of Money, Credit, and Banking)The Federal Reserve injected unprecedented liquidity into banks during the recent crisis through the discount window and Term Auction Facility. We examine the use and effectiveness of these facilities. We find that recipient banks increased their lending overall, both short- and long-term, and in most loan categories. The facilities resulted in enhanced lending at expanding banks and reduced declines at contracting banks. Small banks increased small business lending and large banks increased large business lending. There were no significant changes in loan quality or loan contract terms by either large or small banks.

The Cross-Market Spillover of Economic Shocks through Multimarket Banks (Journal of Financial Intermediation)This study investigates the mortgage lending of banks operating in multiple U.S. metropolitan areas during the housing market collapse of 2007–09. We show that multimarket banks reduced local portfolio lending in response to high overall mortgage delinquencies in their other markets, consistent with the view that local economic shocks can be transmitted to other regions through banks’ internal capital markets. This spillover was greatest when the bank lacked a branch presence and when the market was highly peripheral to the bank in terms of its total mortgage lending. These effects were not fully offset by securitization or other portfolio lenders.

Faculty Publications

Our faculty have written and/or edited a number of scholarly texts, and regularly contribute to journals within their discipline. Learn more about their research below.